Consumer

Color app for iPhone rises privacy concerns

by Jefferson Graham - Mar. 24, 2011 11:17 AMUSA Today

SAN FRANCISCO -- Ever get the urge to peek into someone's mobile phone to see the photos or videos they're snapping? With the new Color app, released Wednesday night, the opportunity to be a photo voyeur can now be yours.

Color, launched for iPhones and Android phones, allows people to shoot photos for the app and share instantly with others nearby running the app.

It's "basic human nature" to want to see photos and videos from others, says Bill Nguyen, the co-founder and CEO of Color. "We're curious."

Silicon Valley venture firms like the concept of Color. The start-up announced it has attracted $41 million in funding for its app from Sequoia Capital, Bain Capital Ventures and Silicon Valley Bank.

It doesn't hurt, either, that Nguyen, a serial entrepreneur, has some splashy successes under his belt. He sold digital music service LaLa to Apple for $40 million in 2009. OpenBox, his first company, was acquired for $850 million. Color is his eighth company.

Gartner analyst Mike McGuire says the sizable stake from venture firms represents the new reality of business in the apps era.

VC firms "realize they don't have a year or two to wait around and see what happens," he says. "Audiences can be aggregated very quickly, and potential buyers will want to move quickly as well."

Color is among a rising category of social apps. Its social app will stream photos to and from your phone as they are snapped. It's ideal for parties of friends wanting to see all the photos taken, Nguyen says.

He also thinks it can be an interesting way to meet people in cafes and bars.

"No other app connects people like Color does," Sequoia Capital partner Douglas Leone says. It's "an instant social network" that captures "experiences with those around you."

Apple shuttered Nguyen's company LaLa shortly after it acquired it. He says he didn't pitch his idea for Color to Apple because he saw it as a service that needed to work everywhere, not on just iPhones. He wants Color to eventually expand to BlackBerry and Windows phones by the end of the year.

Color, of course, is not for those who value their privacy, he says. Everything shot within Color is open and can be accessed without setting up a profile or using a password. "Don't take pictures (within the app) if you don't want to have them shared," he says. "This is like Twitter, in that everything is open."

Nguyen, whose app is free to download, hopes to make money by selling local ads.

McGuire thinks Color has a good chance at success because "people are really interested in having a 360-degree view of what's going on around them. Others might find it oppressive and weird, but then they don't have to use the app."